The "shareholder spring" has spilled into the autumn after investors voted down the pay policies of the electrical retailer Darty in a row over the "golden hello" handed to chief executive Thierry Falque-Pierrotin three years ago.

Investors had been told the share award had performance conditions attached but in fact it did not.

As shareholders were on their way to the meeting in central London the company announced that Falque-Pierrotin was stepping down, by "mutual agreement", in December once a business review by the new chairman is completed.

But some 58% of shareholders still voted against the remuneration report, making it the seventh pay report thrown out by investors this year following Central Rand Gold, Pendragon, Cairn Energy, Centamin, WPP and Aviva.

The storm had been brewing ahead of Thursday's annual meeting at the company, which was known as Kesa before the recent sale of its UK business Comet. Darty admitted it mistakenly told investors in 2009 via a stock exchange "RNS" announcement that the signing-on award for Falque-Pierrotin of 772,681 shares, worth £720,000 when he joined, had performance conditions attached.

The mistake was repeated in four annual reports, including the one published last month. It was only discovered when Eric Knight, whose activist investment company Knight Vinke owns a quarter of Darty, began scrutinising the chief executive's pay.

In an effort to head off a shareholder rebellion, Darty installed former Whitbread boss Alan Parker as its new chairman last month. Parker dismissed the mistakes in the annual reports as a "clerical error" when confronted by shareholders.

At the annual meeting one private shareholder asked: "Who committed the error, who found it out and what action are you taking to resolve it? If it was America people would have been prosecuted for that sort of error."

Parker has sat on the remuneration committee for two years, including most recently as its chair. He said: "I have some sympathy with our shareholders over this issue. A mistake was made, I admit to it and we've got to move on."

Falque-Pierrotin, who presided over a 40% fall in the company's share price, is thought to have earned €6.4m (£5.1m) in cash, pension payments and shares during his tenure. He will be entitled to an estimated €1.2m under the terms of his contract, which allows for a year's salary and pension payments in lieu of notice. He received no bonus this year or last.

Parker's appointment has for now appeased Knight, who had previously threatened to install himself on the board. The activist investor, who voted in person at the annual meeting, said: "There has been a huge under-performance in the last three years. If the board had acted more quickly we wouldn't be sitting on the losses which we have incurred today. We want to move towards a meritocracy in the sense that there should be no performance pay for no performance."

Knight called for all employees to become shareholders, for the number of head offices to be cut, and for the company to sell and lease back its real estate and spend some of the profits on a share buyback to boost the stock price. He also wants the Spanish and Italian ventures, which have lost a combined €350m, to be sold so the group can concentrate on its operations in France, Belgium and Turkey.

Parker has promised to find €20m a year in cost savings, and to carefully consider Knight's suggestions. Announcing the chief executive's departure, he said: "In the light of the changing shape and focus of the business, the board and Thierry have agreed that on completion of the review, which he is part of, it is the right time to hand over to a new person."